A common myth about financial planning is that you need a lot of money to work with a financial advisor. The truth is that essentially anyone can benefit in some capacity from working with an advisor.

The myth may be rooted in the word “wealth” itself, which can mean different things to different people. While everyone can benefit from some level of financial planning — such as budgeting and achieving personal financial goals like paying off credit debt, protecting your income or purchasing a home — as you begin to accumulate wealth or anticipate a significant increase of wealth in the future, the level of service that you are likely to need will increase as your financial situation becomes more complex.

At that point, you may need more than basic financial planning. You may need a wealth management advisor who can help you with these additional considerations. Wealth managers have the ability to organize all of the moving parts of your financial situation, pull everything together and create an overall picture of your financial life.


Wealth management simply brings together disparate accounts, policies, contracts, assets and other financial considerations into one comprehensive analysis. This process includes financial and investment tools and advice, risk and insurance planning, accounting, tax planning, retirement planning, legal advice, estate planning and more. Your wealth management team will get to know you and your goals. Then, with a view of your entire financial picture — both now and projections for what it would look like in the future — the team will work to maximize your financial situation in a way that is entirely unique to you.


In general, wealth management includes strategies to protect, grow and pass on your wealth. What does that look like in practice? Specific wealth management strategies will vary significantly from person to person and will be tailored to your unique financial situation, but they often include:

General investment advice: A good wealth manager won’t just help you create and manage your investment portfolio; he or she will also take time to educate you on what you own, why you own it and how it contributes to the overall health of your portfolio.

Personalized investments: Two of the main drivers of returns for any investment portfolio are asset allocation and security selection. A wealth manager leverages their expertise of markets and the economy, as well as their understanding of you as an individual, to craft an individualized portfolio. Because of their institutional ties, they can also execute investment strategies that might be complicated or otherwise out of reach to an individual investor, such as buying on margin or the inclusion of less liquid assets.

Tax management: A wealth manager will think critically about how a portfolio is built and managed — what assets it holds, what type of accounts it consists of, how long to hold a stock — in order to minimize your tax burden over time and maximize your wealth. For example, a wealth manager might advise you to sell a stock that has been underperforming in order to harvest your losses and reduce your tax burden during a given year.

Just as capital gains taxes and income taxes threaten your wealth while you are alive, gift and estate taxes can threaten the wealth that you try to pass along to your loved ones after you die. A wealth manager will help you craft a plan to minimize these taxes as much as possible in order to preserve as much wealth as is feasible.

Your employee compensation plan: Wealth managers are familiar with even the most complex compensation packages. This may include incorporating deferred compensation or equity plans into your overall wealth management plan and the rest of your portfolio, assisting in the valuation of your plan, or developing a strategy of diversifying away from your plan into a broader and liquid portfolio when it makes sense.

Life insurance: While life insurance financially protects your loved ones from the unexpected, it can also bolster your investment strategy. A permanent life insurance policy, for example, accrues cash value over time, which you can tap during down markets for income rather than selling investments. This gives those assets time to recover rather than locking in losses. A wealth manager can help you understand other ways life insurance can augment your broader plan.

Legal advice: A wealth manager will work with your other advisors, like your attorney, to make sure the appropriate legal documents are in place and are coordinated with your financial portfolio. This may include trusts, your will, a living will, durable powers of attorney, letters of intent and various beneficiary forms, among others.

Charitable donations: Finally, if you would like to reserve a portion of your estate for charitable donations, your wealth manager can help you do so in the most tax-efficient manner possible.

If you find your financial situation growing more complex, wealth management can help you ensure that you are not leaving any stone unturned in growing and preserving your wealth.

Recommended Reading